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Guaranteed to fail

By Nick Malkoutzis

There are many reasons to be alarmed about the upcoming parliamentary elections. The possibility of eight, nine or even 10 parties entering Parliament after May 6 seems a recipe for a particularly unsatisfying political moussaka. The uncertainty over what the next government may look like or if cooperation will be feasible at all is also a cause for dread. The rise of the neofascist Chrysi Avgi is enough to make one sick to the stomach.

Even more alarming though is that with the elections about two weeks away, the political language is more wooden than the ancient fleet which saw off the Persians at Salamina. While Greek voters have largely been anesthetized to the effect of their politicians? rhetoric, the fact that party leaders and parliamentary candidates are spending so much time locked in pointless debates means the crucial issues are being ignored.

It has now been well over a week since Prime Minister Lucas Papademos announced the snap elections and all the party leaders have had a chance to set out their positions and air their views in the media or at public rallies. None, though, has provided even an inkling of a comprehensive economic plan for Greece. Not one that is reliant on a smattering of European Union structural funds to bridge liquidity gaps but one that sets out a vision for how Greece can move forward over the next few years, on which sectors it needs to concentrate, how it will increase exports, how it will stop money leaving the country and how to harness the potential of its human resources.

PASOK leader Evangelos Venizelos has spoken of the need for a ?national regeneration plan,? but for the moment it remains an empty structure. New Democracy chief Antonis Samaras has repeated calls for across-the-board tax cuts, but this also falls well short of the overarching scheme Greece needs. Other leaders have pointed to EU funds and revenues from possible gas and oil drilling as levers for growth.

None of this, though, is relevant to Greece?s immediate economic predicament, which is to create an environment in which businesses can be set up and then allowed to grow. For this to happen, two simple things are needed. The first is for these enterprises to have access to capital and the second is for the state to support them, or at least not stand in their way.

Yet hardly a word has been uttered by the election hopefuls about their plans for reducing bureaucracy. Their silence on the issue of business financing has been deafening.

Which leader, for instance, has set out a plan for how banks should operate following their recapitalization? Greek lenders are poised to receive some 50 billion euros of taxpayers? money but nobody has drawn up a plan for how this money will be allocated, which businesses it will be used to support or on what terms it will be lent.

Greek banks, which announced substantial losses on Friday, appear unwilling to take the initiative on this, instead adopting a rather passive role. They seem reluctant to be agents of growth, preferring to wait or stability to be created by those around them. But even if this were not the case, the fact that public money is going toward keeping them on their feet means the political system has to create a clear funding policy, one that is fit for a changing economy.

Greek banks will also have to adapt with the times. They will no longer be able to rely on property or other assets against which to lend to entrepreneurs. They will have to learn to take the risk of lending to start-ups that are not guaranteed to succeed. They will have to find ways to stand by emerging small and medium-sized enterprises (SMEs).

Speaking at a conference in Athens on Friday, Papademos urged the banks to do more. ?Banks have to take on an active role and assume their responsibilities and move quickly to use available funds and to finance businesses,? he said.

The conference, which focused on SMEs and entrepreneurship, heard of the difficulties that Greek businesses face. But it also heard how some people are triumphing despite the crisis, despite the lack of liquidity and despite the bureaucratic obstacles placed in their way. Since 2009, for example, the new information and communications technology (ICT) firms founded in Greece have generated 25 million euros of profits.

What Greeks should be hearing from their politicians is how these and other enterprises like them will be nurtured and allowed to grow. There is very little time left for strategies to be developed and it weighs particularly heavily on the two leaders vying to lead Greece to present a substantial scheme over the next few days.

Samaras is due to present his economic program on Sunday at Zappeio Hall. He must be hoping it will not go the way of the last two economic agendas he set out at the same location, which came to be known as Zappeio I and Zappeio II. A trilogy of failures would be a blow not just for the New Democracy leader but for Greece if, as opinion polls suggest, he is to have some part to play in the next government.

Venizelos, meanwhile, is also under pressure to get over his vagueness. At his first election rally on Thursday, he said that he ?personally guarantees? Greece will recover from the crisis. These kinds of pledges belong to the past. They are guaranteed to bring nothing but failure.